ADM tries to stimulate soybean sales among US farmers amid low prices

ADM is offering U.S. farmers incentives to ship soybeans to one of its main processing plants this month. Low prices have slowed sales among growers, a trader and a company employee familiar with the situation said, Reuters reports.

In an unusual offer for the busy fall harvest season, ADM is allowing farmers to deliver soybeans to its Decatur, Illinois, plant and set a final selling price later — without paying for storage, two sources said.

In exchange, ADM will take ownership of the soybeans, allowing the company to process the crop, they added.

Record harvests are weighing on prices, and farmers are suffering from high costs for fertilizer and other inputs. In addition, China, the largest importer of soybeans, has switched to South America in response to trade tariffs imposed by the Donald Trump administration this year, depriving American farmers of a key market.

Many farmers are storing soybeans in storage, hoping for better prices in the future, analysts say, leaving large U.S. processors with less of their raw material. ADM’s offer, known as “free deferred pricing,” will run through the end of October, and farmers who join the program will be able to set their selling price through September 2026, a company official said.

“It means they need soybeans, they don’t have enough to keep them going,” said David Yzerman, a farmer in Streator, Illinois, who does not plan to participate in ADM’s program.

Farmers say the offer is unusual because processors usually have plenty of raw material at harvest.

This year, farmers have agreed to sell less of their crop than usual before the harvest season begins, said Miranda Wamsley, ADM’s vice president of producer purchasing. She did not specify the amount. Some farmers say they usually sell about half of their expected crop before harvest, but this year they have sold only 20% or less.

“Because prices are low, everyone is storing grain on their farms and saying, ‘No, you’re not going to get my grain until prices go up,’” said Steve Pitstick, a farmer in Maple Park, Illinois.

But commercial grain companies still need raw materials to process into products like vegetable oil.

U.S. soybean processing rose to the fourth-highest level of any month in September, according to data released Wednesday by the National Oilseed Processors Association.

Deferred pricing can be attractive to farmers with large crops, who need somewhere to store their produce if they don’t want to sell it right away.

Farm storage space is limited, and elevator rents cost a few cents a bushel per month. And the grain can spoil while in storage.

U.S. Agriculture Secretary Brooke Rollins said last week that the Trump administration could introduce a program to help soybean farmers after the two-week government shutdown ends.

“An alarmingly large number of farmers are in financial distress,” wrote Zippy Duvall, president of the American Farm Bureau Federation, in a letter to Trump requesting payments to farmers.

Despite the weak market, companies such as ADM have recently raised their basis rates — the difference between the futures price and the cash price — to encourage crop sales, analysts said.

In late August, American soybean producers wrote to President Donald Trump urging him to reach a trade deal with China that would secure significant soybean purchases, warning of severe long-term economic consequences if China continues to reject American soybeans.

Tags: ADM, soybean, USA